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What Might Drive Mortgage Rates Upward

Welcome to Monday Mortgage Call, a weekly prognosis by Boston mortgage broker Brian Cavanaugh of where the all-important lending rates might be headed.

Wednesday is the week's key day due to the afternoon Fed schedule. Tuesday's data is also key to the bond market, but I think we will see the most volatility in the markets and mortgage rates Wednesday. Despite the GDP reading, I believe Friday is the best candidate for calmest day.

Generally speaking, this is probably going to be a pretty active week for the bond and mortgage markets. It is likely that I will remain very cautious toward rates until the benchmark 10-year Treasury Note yield breaks above 2.9 percent (currently at 2.87 percent) for more than a few minutes to see if that truly is a strong resistance level or if it will continue to rise past. I believe mortgage rates will go up if this happens. Therefore, maintain contact with your mortgage professional if still floating an interest rate and closing in the near future as we are getting very close to that threshold.

As for whether you should lock in an interest rate now, I would:

LOCK if your closing was taking place within seven days…

LOCK if your closing was taking place between eight and 20 days…

LOCK if your closing was taking place between 21 and 60 days…

LOCK if your closing was taking place over 60 days from now…
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